Advice RE New Mortgage/Affordability

johnhill

Hi,

I'll keep it short, i'm just looking for a bit of advice on what's best to do with my loan if i want to get a mortgage soon and all the best lenders for my position, looking to buy a house around december when i get a bonus to help with a deposit.

The Facts:
Salary: £58k
I've been getting decent bonuses last year,this and wil next so
Last P60: £94k and will be roughly the same this year.

Loan: £12k - with Natwest currently paying £614 per month as wanted been paying it down quickly 2 years left of 4 year term, original loan amount £23.5k

Overdraft £5k - regurlarly in it this far!

Credit cards: £1k - will be clear come december

Did have mortgage but sold 4 years ago.

Will have £25k deposit come december in a nationwide save to buy account.

Looking for house arround upto £250k so 10% deposit.

My questions are -
How does my affordability look for different lenders. I have spoken to my bank Natwest and the guy said he can't see any problems - just wondered if others will be ok with this loan payment per month.
Should I re do the loan over say 5 years so the payments are £200 per month, or would this have a negative affect on my credit score?

Also which lenders would be best for my situation, would santander/hsbc be too strict for me. Wondered if i'd be best sticking with my bank as they know my history even if it's not the best rate.

Also will some lenders view me as a first time buyer as i haven't had a mortgage for 3 years.

Thanks in advance

johnhill

Forgot to mention,

Credit checks seem ok:
Experian: 999
Equifax: 508 - just sorting out the electoral roll entry so should go up when they update.

only bad points are about 2 late payments on a credit card back in 2007 - not in a row.

ViolaLass

Regularly going into your overdraft doesn't indicate (to a lender) that you are able to manage your money and it's a curious thing to do when you have so much in savings.

johnhill

Yeah, I recognise it's not great to be in my overdraft, I've been trying to keep my saving seperate so i will definitely have 10% deposit come december. I could pay of my O/D but then will have smaller deposit.
How do lenders view someone using their over draft - is it a big no no?

ViolaLass

johnhill wrote: »

How do lenders view someone using their over draft - is it a big no no?

As I said, it indicates to them that you can't manage your money, which doesn't bode well for paying a mortgage. Also, there is every chance that they will subtract your overdraft amount from your deposit and treat you as if you have the lower amount, which then defeats the point of having kept them separate.

Bear in mind that you're paying interest on that overdraft, so you're paying for the privilege of having more money in your savings - a net loss.

nakiwala123

It's not a big 'no no' as such but the banks might view it as you are either unable to budget/live within your means thus the monthly overspend. Speak to your mortgage advisor regarding which lenders might be more favourable.

nakiwala123

Exactly what Violalass says! beat me to it.

Good luck.